inflation forecasts

Inflation Scares and Forecast-Based Monetary Policy

JEL codes: 
E52
Version Date: 
Dec 2004
Author/s: 
Abstract: 

Central bankers frequently emphasize the critical importance of anchoring private inflation expectations for successful monetary policy and macroeconomic stabilization. In most monetary policy models, however, expectations are already anchored through the assumption of rational expectations and perfect knowledge of the economy.

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